Investment Advisors or Financial Advisers and Planners?

What is the difference between Investment Advisors or Financial Advisers and Planners?

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When considering who can best assist you to achieve everyone’s ultimate goal of financial independence, who gives better value for money, Investment Advisors or Financial Planners.

A recent article in the Huffington Post was quite certain in its opinion on this subject, namely that you are better off seeking holistic financial planning advice from a Financial Advise

They stated that an Investment Advisor normally only gave investment advice without taking into account the client’s circumstances and future financial and life goals. By contract, a Financial Adviser who gives comprehensive lifestyle financial planning advice concentrates on a wide number of areas which are important factors in the client’s medium and long term financial plans towards achieving financial independence, specifically:

Financial Analysis including a report on your current financial situation and forecasting of your cash flow into the future.

Budgeting to assist you in achieving your financial goals

Advice for SME owners in relation to their employee benefits

Advice for SME owners on the most tax-efficient exit from their business

Investment advice and planning

Tax planning

Retirement planning

Estate planning

This analysis by the Huffington Post is accurate. Investment Advisors will normally ask you a few questions about your investment goals, will calculate your risk tolerance and then recommend a portfolio from a number of off the shelf portfolios which they normally recommend to their clients.

A good Financial Advisor who practises Comprehensive Lifestyle Financial Planning will indeed give you investment advice, but it will only be a small part of their service, which is to give you holistic financial advice based on you, your circumstances and your life goals with a view to you achieving total financial independence, this being able to live the life you want without the fear of running out of money. As an existing client, the Financial Adviser, who should be fee based will transact your investment needs for a fee which is only a fraction of that paid to commission based investment advisors.